INCOME TAX ACT, 1961

Section 145

Accounting method - Computations of profit - Addition as income from outside sources in books of account -

AO made additions during a search and seizure operation at business and residential premises of assessee, during that procedure certain books and documents were found. During the course of assessment procedure in the year 1989-90, assessee had stated that certain entries would be explained in the next financial year that is 1990-91. However, subsequently no explanation was furnished and thus he made an addition of Rs. 1,34,870 treating as assessee's income from outside sources in the books of account. CIT(A) held that since documents which were recovered did not bear the handwriting of assessee and any person associated with him, he was not bound to disclose what they were representing and consequently, deleted those additions. Tribunal reversed the order of AO. Held: Tribunal held that figures which were written in a diary which was seized from house of assessee would have to be explained to some extent at least, and assessee could not get away merely by asserting that even though those diaries were recovered from him yet since the handwriting was not proved to be his, he had no duty at all to explain about all those figures. Once assessee accepted the documents which were seized from his premises, and had not offered any explanation whatsoever, the amounts representing therein were rightly added to income as other income of assessee. Thus, appeal of assessee was dismissed.

REFERRED :

FAVOUR : Against the assessee

A.Y. :

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